About Tax Form 1040
What is the 1040 Tax Form for, and how do I file it?
The 1040 Tax Form is the U.S. Individual Income tax return.
All U.S. Citizens are required to file this return if they meet income and age thresholds. In addition, there are some leniencies on the due date, as discussed below.
The U.S. Individual Income Tax Return Form reports the income, capital gains benefits, dividends, adjustments to income, and deductions, to provide your taxable income and income tax amount.
2023 Tax Form 1040 FAQ
You can fill out the below form, use software like turbo tax or H&R block, use a national chain or speak with a CPA or E.A. that you know. We love talking with clients about taxes!
Who files a 1040 Tax Return?
Any U.S. citizen or person living in the united states under qualifying conditions must file a 1040 given income and age thresholds, listed below:
- Single People under the age of 65 exceeding income of $12,400
- Married under 65 exceeding income of $24,800
- Head of Household under 65 exceeding income of $18,650
No matter income or age, certain situations can apply to you that still require you to file, such as:
- Owing any special taxes
- You or your spouse received HSA or MSA distributions
- You had self-employed net earning in excess of $400
- Advance payments of premium tax credits were made to you
What should my name be on my return?
Ensure that the names used on your return match exactly what the Social Security Administration has for your Social Security Number. Your return will likely be rejected without this because it doesn’t match. This includes not just the primary filer but spouses and dependents.
Should I check the Presidential Election Campaign Box?
This is entirely up to you and is optional. This does not reduce your return or cost you anything. This is just an option you have for which the government will contribute funds on your behalf.
What if I have a virtual currency?
At any time during the tax year, if you owned or traded bitcoin, dogecoin, or any other virtual currency, you are required to inform the IRS and report those trades to be considered as income or capital gains.
What is the difference between Earned Income and Unearned Income?
Earned income like wages is taxed on with federal income taxes, Social Security and Medicare taxes, and depending on your state, state taxes.
Unearned income like child support and social security benefits don’t have payroll taxes (Medicare and Social Security), and sometimes there are no federal or state income taxes.
Do I have dependents?
Dependents allow you to be eligible for certain deductions and tax breaks like the child tax credit and help you change your filing status to head of household. A dependent is any person you are responsible for supporting throughout the tax year. To avoid later ramifications, always understand who will claim dependents in a split household with a shared custody situation.
Dependents can either be a qualifying child under the age of 19. 24 if they are a full-time student who lives with you for more than half the year and doesn’t contribute to more than half their support.
Or you can have a qualifying relative who has a specific family relationship with you, lives with you for the full year for whom you are paying at least half their living expenses, and they earn very little.
Should I itemize my deduction?
This is tricky and depends on two major things. First, what types of expenses do you have that would be considered deductible (Mortgage Interest, other taxes, vehicle fees, major medical bills, etc.), along with how good are you at keeping track of the paperwork associated with these deductions.
There are many deductible expenses, but most people do not keep track of their receipts and paperwork to help substantiate these deductions properly, which is why the standard deduction tends to be most people’s best choice.
What is the difference between a tax deduction and a tax credit?
Deductions reduce the amount of income you pay taxes on, which helps to reduce your taxes based on your tax bracket.
For example: If you earn $50,000 and claim a $1,500 itemized deduction on your home mortgage interest, this will save you approximately $300 if you are at the 20% tax bracket
Tax Credits are dollar for dollar tax reductions that you can take advantage of to reduce the amount that you are paying in taxes. Keep in mind a tax credit will only apply if you owe taxes. If a credit exceeds taxes owed, you lose out on the rest of that credit.
For example, if you buy a qualifying battery electric vehicle and receive a $1,500 tax credit, it will reduce the amount of taxes you owe by $1,500.
Do I need to file anything in addition to my 1040 return?
Depending on what activities you are involved in, you may need to file one or more schedules to report earnings and activities in more detail for certain situations. Below is a list of some common addendums and schedules you may have to file with more information on each.
- Schedule 1 – Additional Income
- Schedule 3 – Additional Credits and Payments
- Schedule B – Interest and Ordinary Dividends
- Schedule C – Business Income
- Schedule D – Sale of Assets
- Schedule E – Rental Property, Royalties, and K-1s
- Schedule F – Farm Income
- Schedule S.E. – Self Employed Tax
How do I file a 1040 Tax Form?
You can prepare a 1040 yourself or work with a tax professional to help you file or file for you. The major tax software programs like Turbo Tax and H&R block include filing a 1040. However, due to complexity, it is highly recommended to have a professional at least review your return if not help you file your return.
We have provided a link with detailed instructions from the IRS to walk you through the proper way to fill out and file the 1040 Tax Form.
What is and how to fill out the Tax Form 1040
We specialize in filing business taxes and are happy to help you and your business make the best tax choices for you. Contact us today!
Can I E-File a 1040 Tax Form?
Yes! In fact, E-Filing is encouraged to expedite your refund if you are owed one and reduce the stress on whether your return is accepted. Therefore, we have provided an easily downloadable link to the 1040 Tax Form from the IRS.
U.S. Induvidual Income Tax Return – Download Form 1040
Can I Mail in my 1040 Tax Form?
As long as you are not required to E-File, you are welcome to mail in your return. Where you mail your return depends on your primary business location, the value of your assets, and what schedule you file.
See our list of addresses here.
What are the requirements to file my 1040 Tax Form?
You must file your 1040 by the 15th day of the 4th month after the end of the year or April 15th without an extension.
What are the penalties if I don’t file on time?
If you are due a refund, there is no penalty for filing late. However, you must file your return within three years of the due date (April 15th, three years after) to claim your refund.
Those who owe taxes and do not file or pay in a timely manner may incur many penalties. Read more here.
What if I still have questions about the 1040 Tax Form?
Reach out! That’s why we are here. To help guide you and teach you the proper accounting methods to apply to your business.
